Rapid Response: Waging a $1.4 trillion food fight, w/Impossible Foods CEO Peter McGuinness

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The biggest, most impactful thing to reverse climate change. And help protect the planet. Is food. I wanna be the number one plant based meat. But that's small ball.

We wanna actually take some of that one point four trillion dollar opportunity. Away from the animal products. If you take a position on something that's important, And you piss a few people off along the way. They probably weren't the people that were gonna buy your product anyway.

You know, a lot of these risk adverse companies that try to please everybody, they're nothing. To anybody. So you gotta have a point of view, you gotta have a soul. Gotta have a heart. And you know, you gotta have some judgment too.

That's Peter McGinnis, the CEO of Impossible Foods, the fast rising purveyor of plant based meat. Impossible wants to remake the calculus of climate change by weaning the world off of animal meat. I'm Bob Safian. Former editor of Fast Company, founder of the Flux Group, and host of Masters of Scale Rapid Response. I wanted to talk to Peter because as a leader at Chobani previously, he helped remake the dairy aisle, and he has a distinctive perspective on what's required to take on the meat market.

Peter talks about the lapses that have plagued the plant-based category and how branding, fundamentals, and a focus on new generations can reset expectations. Doing good is good business, he argues, and not just because it leads to partnerships with the likes of Billy Eilish. Peter is convinced that impossible can do the impossible. Helping to change eating habits worldwide. His ultimate lessons are about what he calls phasing and pacing.

You can get drunk on opportunity, he says, but to make truly scale change for the environment and for a business, you need to execute at a high level in every part of the operation. F I'm Bob Sapphian and I'm here with Peter McGuinness, the CEO of Impossible Foods. Peter, thanks for joining us. Thanks for having me.

You and I first Matt. I think when I was at Fast Company and you were at Shobani, you were then probably chief marketing and brand officer when we first met, and eventually president and chief operating officer. He had a great run working with Founder Hamdi Yulukaia Chobani changed the yogurt industry, the dairy and food industry in many ways.

Now You've moved to impossible foods, a leader in plant based meat. You're Taken over as CEO just a few months ago. What prompted you to make this change?

You know, I've been at Giovanni for ten years and it's an amazing company. Had a great run. Value space company, growth company, modern food company. Beautiful company.

In many ways it made me the professional I am today. If I was gonna leave a great company like Tibani It wasn't gonna be for some big CPG. That makes bad food or has bad brands or has no value system. It was gonna be for one of tomorrow's

Food companies. That's making a difference in the world. That not only has great products, but has a big heart. And that's innovative at the core. That's exciting and creative.

So When Impossible had reached out, I said, Wow, it's really interesting and plant based and Such a massive market. It's so under penetrated, you're talking under ten percent household penetration in the US. under fifteen percent on aided awareness.

one point four trillion dollar addressable market. you know, impossible is able to make food that mirrors and mimics the animal product to the point where it's as good If not preferred. And then of course it's better for you'cause it's zero cholesterol.

And zero trans fat. And it does amazing things for the planet in terms of water. And greenhouse gases and less land use. Um You sit there and say, Wow, that's a super exciting proposition.

Early on. So you have a You have an opportunity to to have the two eyes, right? Make a big impact and have a huge influence. and help really kind of curate and craft the story. So it was just super exciting to me. And by the way, I was also having the food, I didn't realise it.

So you didn't realise you were eating impossible food. My daughter was giving me chicken nuggets as I was on Zoom calls and for two months I was just popping these chicken nuggets. I had no idea. And they were plant based impossible chicken nuggets. And she told me like eight weeks later, She's like, You know, you've been eating plant based chicken nuggets. I was like, You're kidding me. So I had an aha moment with the food, too. You seem pretty animated by this.

Bob like you know, forty three percent of the earth's usable landmass. is related in some way to animal agriculture. Towns and cities are less than 3%. You know, I did a

Billy Eilish and Maggie Baird event in the UK a couple of weeks ago and I talked to that audience and said, Look two point five billion burgers are eaten in the UK. And If you just reduce that by one million burgers a year, it's twenty five million less gallons of water. And you're gonna save three hundred and eighty two thousand trees.

So The linkage between the food choices we make And The planet. Are

Powerful. when we think climate change, most people think Oh, recycle or use a little less water or turn the lights off. Or Drive an electric car. Those are all really good things.

The biggest most impactful thing to reverse climate change And help protect the planet. Is Food. And that's something I didn't understand.

And I'm not really sure where it's going and I'm not sure how fast it's gonna happen. But one thing for sure that's undeniable is the world. is moving in this direction. And I want to be part of that. So

You're excited by this opportunity and by the mission. You come over your first time as a CEO, you're taking over from a founder. How do you spend your first ninety days? Like, how do you attack That Opportunity in that time.

I think learning. I've gone to our factory in Oakland. I've gone to our co manufacturers in Los Angeles and Chicago. I've gone to our key ingredient suppliers. In Nebraska. And in Illinois. So I want to learn the supply chain part of it,'cause we're food makers.

And I wanted to learn the front end of the business and commercial side of the business through meeting a lot of our top Customers and retail partners. And then I wanted to learn the culture through Meeting the people, the folks, right?'Cause this is a passion brand.

And the beautiful thing about impossible is That Driving growth. And Achieving the mission.

Are inextricably linked. So there is no conflict of interest in terms of business and doing good. They're mutually inclusive. You mentioned that you were hanging out with Billy Eilish at this event. In London.

How important is partnership and I guess celebrity. In taking impossible foods. to the next level. I mean part of your success at Shobani was Getting the brand know this, there's nothing inherently sexy about yogurt, right? But you you at least you made it feel desirable.

Branding is a really, really big part of it. But I'm in favor of Authentic. Brand creation.

I'm a bigger fan of earned and owned than I am of paid. I'm a bigger fan of let's define our brand. versus let other people define it. And in the case of Billy Eilish It's not her celebrity.

Right. She's an authentic voice. that passionately cares about climate change. It is her thing. It's not made up, right? Overheated is the name of one of her songs and it's a name of her and her mother's climate platform. And she's a vegan and her mom's a vegan and

They For the first time ever. Made the O two in In London for two weeks. Vegan.

You know, meat free. And we serve the food. It was all impossible food at the overheated I like that collaboration'cause it's not like some paid sizzly superficial type of thing. It's a deep, integrated Kindred spirit.

participatory, like minded platform. It's a nice coming out. For you though as CEO too to be sort of your first larger public Was that already in train or is that something you sort of

Put together. Yeah, I think it was being debated when I first started and You know, we all agreed, let's do it. And you also have to think about the audience. The younger generation's gonna change the world.

There's just no question about it. They're more conscious, they're more open. They're more aware. Not to say that there's not a role for Old people like me. You know. You can teach an old dog new tricks and

Everybody has a heart somewhere. But this generation is predisposed. It's funny, I my son's in fifth grade and his science teacher asked me to come teach two science classes around climate change. And they're learning about climate change in fifth grade. Of course they do recycling and things like that, but they really wanted to understand the magnitude of the climate problem.

And the actions required. And off I went and I served the chicken nuggets and all the products and the kids were like, No way, this is not plant based. Tastes great. And we talked about Land mass and we talked about food choice and we went through the calculator.

in terms of the impact you can have just by altering your diet ever so slightly. These kids were just wide eyed. And so receptive. There's been some rumbling that the plant based meat industry is like slowing down a little bit this transition. What's happening? What makes impossible different from other

Plant based. Meet organizations. There's a competition problem, not a category problem. You know. We had seen that in yogurt years back.

There's some legacy brands. That got into the business ten, twelve years ago. That are from big conglomerate companies that are in the space. The products were okay, not great.

They're probably over distributed. I look at the category and the category's flat. I don't like a flat category. But it's self inflicted wounds. There's a lot of new folks that can't scale.

Old legacy brands that are Not great products. And then there's Companies like Impossible that are technology based that are making products that are as good, if not better, than animal products. So a chicken nugget is preferred.

to the animal chicken nugget seventy to thirty. Right, our beef is like Fifty fifty. Which I still think is amazing considering how much people love their burgers. The category's done an awful job of articulating the benefits.

And we impossible. also have not done a great job of what that value proposition is. So I don't want to compromise my taste. I don't want to compromise my texture. The smell of the product.

How satisfying the product is. And then I wanna know is it better for me, right? Because I care about my health, so you know zero cholesterol, no trans fat. And then It's better for the planet.

And that becomes a Quite a Interesting value proposition now. None of this has been articulated. None of this has been done in a compelling way. Right.

It's just true. The animal industry's done a great job of like a coalition of the willing lobbying the government and spending, you know, half a billion dollars a year in advertising. Right. Our category is full of a bunch of small players and some legacy players. We haven't gotten the narrative down. And Impossible's very young too. We've only been in retail

Grocery store shelves for a year and a half. So we gotta do a better job of communicating the benefits. Of plant based meat. To consumers. In a mass way.

And and it can't live on the coasts. It can't live in academia. It can't live among Wealthy Educated people only.

This has to become mass. You're starting to see H B in Texas and publics in Florida and Mire And Michigan and Target and Walmart and Kroger. And stop and shop and shop right. So

It's starting to get the mass distribution, but it does not yet have the mass Awareness understanding and adoption. That Is

The key to this whole thing. And in telling this New story. Like it's barbecue season now, right? Like how important is it to Take advantage of or use these kind of seasonal opportunities.

You have to participate. Barbecues are fun. July fourth is amazing. Memorial Day's amazing. Labor Day's amazing. Those are high

Animal meat. Indexing events. Yes, I want to be the number one plant based meat. But that's small ball. We want to actually take some of that one point four trillion dollar opportunity.

Away from the animal products. So a big part of this is what is that narrative, what is that messaging? that compelling creative messaging that get people to understand this in shorthand. In a mass way.

regardless of your socio economic status, regardless of where you live in the country. And it sounds like you're not sure what that message is yet. You're working on it. Like you have a sense of what it is, but you're not quite sure yet. It's very much a work in progress and you're gonna see us get much more aggressive in the advertising and marketing space in the first half of next year. We've almost done no paid advertising.

Up until now. And I think it is time to introduce the world to impossible foods. Also sampling. Our food tastes great. In many ways this is kinda just Fundamental stuff.

Right. Go get some more distribution. Go tell the world. From a communication perspective about impossible'cause we have fourteen percent. Une aided awareness.

then go get more people to try it because the perception is lagging the reality. Nine out of ten people have an aha moment where like, that is way better than I thought it would be. So let me ask you about Costs.

Inflation has obviously become a a bigger Deal in the economy overall the price of meat. began rising back in the early pandemic days. So that's going up. Does that offer a Competitive advantage for plant based beet. Look.

Animal protein is very inefficient protein. Right. You have to feed that animal. A lot of water and food for them to grow. And then You have to kill that animal in order for us to get the protein.

And You're talking weight and freight and shipping and It is a complicated, costly supply chain. And we have much more efficient. protein delivery. That's easier to make, easier to ship.

And so that will always be an ongoing advantage. Particularly to Impossible, we have long term contracts in place for our textured vegetable protein and our heme. So we've been able to combat inflation, luckily. So you've seen us keep our prices flat. Which I don't think anyone in the last two years has done.

And you've seen beef prices go up. Anywhere from ten to twelve to fourteen percent. So I I do think it will help the whole value proposition. For sure. When you've built substantial wealth through your business, it's often tied up in a single equity position. The upside is real, but so is the risk, and knowing when to act isn't always obvious.

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Before the break, we heard Peter McGuinness, CEO of Impossible Foods, talk about the challenges and opportunities in getting consumers to adopt his company's plant based meat products. Now He talks about the difference between being an activist brand and an active brand. And what prompted him to take a public stance on Roe v. Wade. He says that if you're running a values based business, you need to wait into societal things.

That not standing for something is in his words safe and lame. At the same time, he stresses the importance of business fundamentals in achieving both values based and business based goals. Plus He offers lessons about how to approach Gen Z and why he believes that impossible scale journey is just beginning. You've

Talked a bit about sort of the cultural mission that is embedded in Impossible. There's a lot of pressure these days on brands and business leaders. to take positions on social and even political Topics. When word first leaked that Roe v. Wade might be overturn, you quickly a statement. How did that come about? The thing about impossible, it's inherently values based because of the product we make, right? And we're trying to reverse climate change.

But I think any good brand should stand for more than the products it makes. We can't just Stand for climate change. So When I came on nine weeks ago One of the things that struck me is we had a hundred percent of our medical paid.

And I was like, wow, that's really cool. Two weeks later, three weeks later, I was traveling, I think I was in Nebraska at the time and It had been leaked that it was gonna be overturned. And You know, I got the team on the phone and said we have to respond to this.

And it's important. It's an extension. It's not a new new concept. I said we're already giving a hundred percent medical. We're already there. From an essence and culture perspective. And so It was a one minute conversation because

There was no debate and of course what I love about You know, running a a relatively small private company is there's no hierarchy. So I said we're gonna change the policy. to do this. And everyone just within seconds said, You're damn right we are.

And it was done. And it was done within minutes. Minutes. And so I'm super proud of that. You need to wade into societal things. You need to be a good corporate citizen.

And this weighing into societal things, like there's a risk, right? That there are potential customers who you're gonna put off. By sure taking certain positions, whether it's on row or on guns or on other things. You're already Trying to convert people's points of view about me. There are thoughts that like Is this just make it more complicated?

Look, I think My aspirations for Impossible is not to be an activist brand. It's to be an active brand. And so If you take a position on something that's important.

And you piss a few people off along the way. They probably weren't the people that were gonna buy your product anyway. Marketing in the middle. Is just lame.

And not standing for something is safe. And lame. And so You know, a lot of these risk adverse companies that try to please everybody and be all things to everybody

They're nothing. To anybody. You gotta have a point of view, you gotta have a soul. Gotta have a heart. And

You know, you gotta have some judgment too. Right. We're a food company, so getting our products to people in need and helping combat hunger. Whether that be with refugees or whether that be with folks in our communities.

here in in the Bay Area. That's foundational. But we're not gonna sit here and have a strong point of view on every single issue. Cause I don't wanna politicize this brand. And I don't want to make it into an activist brand. But we are gonna wade into some certain things that we feel are very, very important. And that play book is different for each company. And I guess with each of these issues it becomes an opportunity to

Define your brand either by becoming active in that area. Or choosing not to be active. Both. Do define it. To a degree.

And dimensionalize it. You posted a letter on LinkedIn recently urging businesses to be more receptive to Gen Z and younger constituents. What prompted you to write that? So I think I got a little inspiration from the overheated event. the average age of that event that I was at.

was nineteen, twenty year old. Influencers. They all rallied around this. Climate. Cause you know.

And they all did it in their own Way. And I just left saying This is the generation Also as a business leader

This generation's been hard to define, it's been hard to recruit, it's been hard to retain. It's been this holy grail of business, like What are we doing? Are we even trying to understand them? I think we have to better understand this generation.

And I think we have to better support this generation. I wrote it kind of. Partly For business and partly just

That This is a special generation that's Gonna do seriously impactful things. But they're not gonna sit around

And be told what to do. They're gonna challenge And we have to be okay with it. You gotta be okay with that as an employer. And you gotta be okay with that as a mother and a father.

As an aunt and uncle. As a grandmother and a grandfather. So celebrate what's unique about that generation. Right? And lean in. And I guess for your business.

recognize that you have to engage with that generation In the way they want to be engaged with. Absolutely. This generation's gonna bring a new set of ideas. And a new set of ideals.

kind of infiltrate the company in a very positive way that again keeps companies relevant and current. So a lot of the listeners to this show, they're entrepreneurs. Some of them founders themselves. You Worked closely with a founder with

Hamdiya Chobani, you taken over from a founder from Pat Brown there at Impossible. How do you navigate that as someone new coming in? Like what's Being a founder versus

Following a founder? Founders see things people Don't see. The world wouldn't be

Where we are without founders. And I've never found it anything in my life. Mm. I I I'm just not capable of it. And I have infinite respect for those who do.

You have to honor The mission. And the products. And help. In the case of impossible

We're growing at sixty five percent. The fastest growing plant based brand. In the country. Which is great. But we want that to be a hundred percent. We want that to be a hundred and twenty percent. We have

Four hundred total distribution points. I wanna have four thousand total distribution points. And so if I can help do that. Well then I've helped The mission.

Which is so important to the founder. It's fundamental to the company. I remember when I first came on I had a town hall. I said there's nothing fundamentally wrong. That impossible.

It's cool brand, it's cool product. We're growing at sixty five percent. But there's a whole lot of work still to do. And so I just want to come in and help. Right.

Amplify that. And turbocharge that. And The reality is that The category

And the company in this case are in its infancy. There's so many more products to launch. There's so much more distribution to get. There's so many more channels to go in. There's so many more geographies to go after. We just launched in the UK and Europe. Just launched in Australia.

These are Tiny businesses, right? And so there's just an enormous amount of work to get done. To realize this in a real tangible way.

So What's Similar about Chobani and Impossible. And what's different. I think they're

Similarities are They're entrepreneurial, they're creative. They're mission based. They make great products. They're founder led.

And they're challenging convention. They're challenging legacy. Food companies. And that's a beautiful thing. underpinning it is a strong value system and belief system.

Right. To try to make the world a better place. And do good. Impossible is really more around climate change. That's certainly different.

And that Better plant based meat options more adopted by more people in more places. What we're gonna do is focus on the fundamentals at impossible. Right. The company's healthy. We have a strong cash position.

We have good partners, good suppliers. Product quality's great. And this is just about Unleashing growth. How high's up?

We don't know. But We gotta do the fundamentals too, right? We're a technology company. Right, on one hand. That's what's making food That mirrors animal products.

And in many cases is better. But we are a food company. Right. We're making and selling it. Shipping food. We also have to keep that food side of the business going, which is, you know, more doors, more stores.

What's our promotional strategy? What's her channel strategy? What's our international strategy? So there's a lot of nuts and bolts. There's almost

Too much opportunity out there. And you can get drunk on that opportunity. And What I think we need to do is almost phase it and pace it. So

Almost Showing restraint. Which is a weird thing. Right. Because you can see so many opportunities, but we can't do it. We're not

ready to take on all of that. We don't have an infrastructure to take on all of that. So how do we come up with a plan That prioritizes. And phases. And pace. versus going after it all at once, which is enticing.

I like to go after it. I think everyone in Impossible likes to go after it, but we can't do it all at once. So I think that's a It's a nice challenge to have, but nonetheless a challenge.

Well a colleague of mine used to say we can do anything, but we can't do everything. Yes. And you gotta make those choices. Gotta make the choices. Well, Peter, this has been great. Thanks so much for taking the time to chat with us. Really appreciate it. Uh loved it. Loved it. Thank you so much. Good to see you.

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